Anglo Pacific Share Discussion Threads

[cocopah] 05/4/2022 18:04

#LLB given the sustained high commodity prices (which look like running for at least six months of this year) what’s your best guess for a share price high in 2022? I am thinking somewhere between £2.10 and £2.30. 🤷‍a94;️🤔😎

[laurence llewelyn binliner] 05/4/2022 16:59

Check out the UT finish, 155,528 matched at 182 pence.. :o)

New ISA day tomorrow..

[podgyted] 05/4/2022 14:03

NB. Subject to change.

[podgyted] 05/4/2022 13:47

According to my notes they've actually advised the TU will be on 27/4/22.

[masurenguy] 05/4/2022 08:10

They don't issue "results" for Q1. They usually provide a Q1 trading update circa end April/early May.

[dgellissnr] 04/4/2022 19:37

When are q1 results out please

[haywards26] 04/4/2022 15:51

The EU reducing and ending their Russian coal imports following the recently reported civilian war atrocity identification, will only lead to coal prices increasing or at least holding at current lofty levels for foreseeable.

[laurence llewelyn binliner] 04/4/2022 15:13

We have started our Q2 on almost double the Q4 (AUD308) met coal price, if it holds up the income results might well blow the doors off, the VB debt will not be around for long.. :o)

182 pence paid this morning as the rerating to income gathers momentum..

[gateside] 02/4/2022 20:43

Nobody ever lost money taking a profit.

[cocopah] 02/4/2022 20:10

Well that was an interesting crop of posts. The sooner we hit £2.20+ the better now for me … sell and recycle.👍
27995;

[tim000] 02/4/2022 18:33

Thanks, good post. As a contrarian investor, I hold a lot of coal stocks, including Whitehaven who I believe were the counterparty to APFs royalty sale.

[meanreverter] 02/4/2022 14:36

According to academic theory, the overall return from investing in companies that reinvest their earnings should match that from companies paying out most of their earnings as dividends. In practice, it's not so simple. In the very long run (say 50 or 100 years) a global income portfolio comfortably outperforms a growth portfolio. However, over the past 10 or so years, it's been the other way round. My guess is that this is down to a handful of American technology-based superstars, of which TSLA is the most extreme (albeit not the biggest) example. There is already evidence that this decade-long exception is starting to revert to the longer-term pattern.

In general, I second 1knocker's point (post 11683): "The advantage of dividends is that one can reinvest them in whatever stock seems the best value, not necessarily the company which generated them".

Exceptionally, I continue to hold JLP, because its brilliant boss can make much better use of retained earnings, by expanding the company's operations, than I could expect to do by investing any dividends that it might pay out.

I don't have the same view about APF, though. I still hold it, largely by inertia but also because its exposure to cobalt adds diversity to my portfolio. The big sell-out at the bottom of the market for coal assets (not for coal prices!), under pressure from the baying mob, didn't impress me too well.

[laurence llewelyn binliner] 02/4/2022 14:09

All eyes on our Q1 update here now and it is going to be robust that is for sure, and judging by the size of the grin on MBL's face it could be better, that should get our share price marching north ..

Q4 Kestrel income was USD26M at 308 per tonne coal price
At 27.01.2022 prices were 400 per tonne and we know in March prices were up at 600 a tonne, all at the 15% royalty band.. :o)

Q1-2022 update - 27.04.2022
VEIN Dugbe DFS - by end of April
Q2-2022 update - 28.07.2022
H1 financials - 24.08.2022

[fordtin] 02/4/2022 11:36

tim000 - very happy with DEC, but I’ve been trying to maintain a disciplined diversity. I try not to keep more than 5% of my dividend portfolio in any single company, regardless of how good I think it looks.

I am struggling to maintain that discipline with DEC because reinvesting the exceptionately high dividends, plus recent share price appreciation have pushed it up to about 7% of my dividend portfolio.

I don’t want to top slice it yet because I think it’s got quite a bit further to go, is still one of the highest dividend payers in my portfolio and I can’t see anything I’d rather switch the funds into.

[tim000] 02/4/2022 10:07

fordtin, that’s a valid point - my argument depends on a stable share price, otherwise one might be forced into firesale disposals. If anyone is looking for high yielding shares, they might look at DEC.

[fordtin] 02/4/2022 09:14

tim000 - I'll soon be in a similar situation to you. Although I'm reinvesting dividends at the moment, very soon I'll need an income from my investments.

Dividends can never be guaranteed, but they do at least provide some ability to forecast future income.

If I had to rely on sale of shares for income, I would've had to sell APF for less than £1 at the tale end of 2020, greatly diminishing future income potential.

There is no way to tell whether another outbreak of covid, or escalation in Ukraine will send the markets back down again.

If a company cuts the dividend, I can sell and move the funds to another company with a more stable dividend policy and dividend cover.

As such, when APF confirmed the dividend was only 7p, I sold 40% of my shares.

I do think all being well with the World, APF still has plenty of room for share price growth. So I intend to hang on to the rest for a bit longer before rotating them into higher yielding companies.

[laurence llewelyn binliner] 02/4/2022 09:14

Over time, a decade or more, a fund reinvesting 5% in itself, and paying out 7p or 3/4% is going to grow far quicker than a fund paying away 7/8/9%, the compound growth curve is startling when it kicks in, a dividend sacrifice to fuel growth and deliver a greater compound performance demonstrated in the share price is IMO the way to go now, sell off a few shares along the way to supplement income if necessary, but a fund paying away 7/8/9% will not produce much growth unfortunately.., this is where we are on our journey with APF now and IMO will make us more attractive to investors looking for growth, including IIs, and we still have 5M shares in treasury too.. :o)

We could be cash positive by Q3/Q4-2022 and what a position to be in just as the Incoa tranche2 is due, and then we can build on Piaui next.

Income seekers might consider something like BIPS a bond focused fund that will never grow in value, but will always pay a safe 6%..

VEIN/Dugbe DFS in just 3/4 weeks time

[tim000] 02/4/2022 01:06

I haven’t seen any research on this, but my strong impression is that companies that pay large dividends typically have a very poor growth record - which they need not as they can always borrow in capital markets to replace the capital paid out in dividends. So I’m happy if the APF management focus on growing the business at the expense of a progressive dividend policy. Provided of course they are expert at asset acquisition!

[tim000] 02/4/2022 00:54

For me personally, I need income so can’t reinvest dividends. But I don’t think that argument holds as equally I could reinvest the proceeds of share sales. Without having gone through a theoretical mathematical analysis, I just assume that for someone who needs income, there is no difference how the income is extracted from a company - directly from dividends or from share sales. Transactions costs are pretty trivial, but you’re right that I shouldn’t overlook them completely. Specifically wrt APF, I hold them because I like their growth prospects in a world of inflating commodity prices.

[1knocker] 02/4/2022 00:31

Have you taken into account the compounding effect of reinvesting dividends in your comparison?

The advantage of dividends is that one can reinvest them in whatever stock seems the best value, not necessarily the company which generated them

The disadvantage of selling stock for name is tat it is expensive in dealing costs if one draws fro a range of stocks rather than selling down one or two in sums far in excess of their growth, so its not really practical unless you have a large value portfolio concentrated in few holdings.

[tim000] 02/4/2022 00:15

I am a shareholder. Regarding the debate about dividends, I don’t see the difference between a strategy of the company sacrificing some growth to pay higher dividends, and one where it allocates more capital to growth instead so the shareholder maintains a higher income by selling a few of the (higher appreciating) shares. In one case the company sacrifices growth for income, in the other the shareholder achieves the same outcome by share disposals. Surely the only difference is which is more tax efficient? I would guess that on balance, dividends are more likely to be taxed than capital gains. This issue matters to me as I (as a pensioner) finance my income not from dividends but from sales of appreciating shares. My experience is that investing in growth stocks results in higher total returns than investing in income stocks.

[woodhawk] 01/4/2022 22:35

I have emailed the company regarding my disappointment with the regressive divi - if they respond with anything of note, I will relay it here.

[cocopah] 01/4/2022 22:14

#LLB The share price might hit the sweet spot and it might not, however it is likely that commodity prices (met coal in particular) will not continue to soar and will likely retrace at some point this coming year. The bottom line is, if I’m not going to be rewarded by a significant rise in the share price and the forward return is <4% then I’m caught in no-man’s land (along with a lot of other investors). I’m not sure that the languishing share price of the last year was down to anything but waiting for promised income to be realised and communicated (IMHO APF was/is still too small a market cap to get thorough broker analysis).

If the new CEO had indicated that at least some divi progression would be in his plans after H2 then I’d be more convinced to continue to hold long-term … but he was clear that this is not on the cards.

No complaints on my returns to date, however anything over £2.20 per share will provide me with a handsome return on my investment (with little potential for significant further upside) … but why would I then hold for a divi of 3.11% on that share price, when I could reinvest for a reasonably safe 5% elsewhere, having doubled my capital?🤷205;♂️